What's next?

Some brands will emerge at the other end, changed by the transition, of course. If it's like other shakeouts, there will be survivors.

Also, now would be a good time to launch the analog of Dell or a Gateway, to pick off the parts of Yahoo, AOL and eBay, etc that work. Any of these companies or Microsoft, would probably do better to farm out the job than try to do it itself, if history is a guide. Like IBM and DEC doing PCs, they all were designed to solve a different problem.

A shakeout fund?

Today if I had $500 million I wouldn't start a VC fund, I'd start a bottom-fishing fund. What out there has lots of cash, but is on a downward spiral? I'll take their cash and the good people who are still there. What has lots of technical promise but little staff and little cash? Make introductions.

Be, for example, who announced layoffs, has enough cash to be interesting, and a fantastic code base that should not go to waste, and probably a few really committed people who would love to do something interesting, as opposed to remaining on a death watch.

How many other companies are in this position? Are any of them getting creative on the way down? Watch for that. If you see signs, send me pointers. I'll contribute flow to the resurrection.